Warner Todd Huston
Another unelected Obama 'committee' to control healthcare costs
By Warner Todd Huston
July 30, 2009

Franklin Roosevelt thought controlling prices of things would right the depressed economy. Today, more economists every day are admitting that his efforts caused The Great Depression to last at least five years longer than it needed to. In the 70s Richard Nixon thought that his program of price controls would save the economy. Instead, it wrecked it further. And now, in 2009, as the Obama administration contemplates a massive government takeover of the nation's healthcare system — nearly 20% of our national economy — at the top of the list of things to do is to set up effective price controls on services.

In fact, Medicare already does this and it has been the sort of mandates and government meddling that has helped lead to the downfall of our medical system as it is. Right now, Medicare pays only some 40% of the actual costs of medical care forcing one of several situations. Doctors that end up not getting paid, patients on the hook for what is left, or hospitals that never get reimbursed for services causing them to try and charge higher prices to everyone else to make up the difference. And, of course, the low reimbursement rates that Medicare pays out has an effect on the high cost of insurance, as well.

But what will come once Obamacare is passed will far exceed the mess that the price fixing via Medicare has wrought. Worse, there will be no effective way for the people to have a say in what sort of prices that government forces on the industry because Obama plans to create another one of his ubiquitous "committees" with a mandate to set these price controls, fees and schedules.

There are many voices standing against this unelected body of mysterious government perfunctories setting price controls on the medical community. For instance, the American Medical Association and the American College of Surgeons are both voicing their concerns over this White House appointed committee.

White House Budget Director Peter Orszag is proposing that once the president approves of the controls set by this committee then they automatically go into effect. The only way to stop them is for Congress to raise an effort to block implementation. In essence, what we have is an unelected board of political appointees being handed massive power all the while they are completely unaccountable to the voters.

There is one way, however, that this unelected committee will be affected: lobbyists. But it won't be lobbyists directly influencing the committee members as much as it will be money "donated" to the people who appoint the committee members. In this case, it will be the president.

We can see a recent example of what I am talking about in California. It has been discovered that State Attorney General Jerry Brown has benefitted from over $10 million in "gift contributions" to his pet charities from special interests that he is charged to oversee in the state. So, all the interests that Jerry Brown is responsible to regulate have, out of the goodness of their hearts, suddenly decided it was a great idea to donate to all of Jerry Brown's favored organizations.

Gee. Whattaya think that will get them if not favored decisions from Brown's office?

So, let us extrapolate what happened in California to this healthcare price control committee controlled by and appointed by one man, the president. We will see an influx of lobbyist money in donations to Obama's (or any president that controls this committee) favorite causes as well as his campaign. And why would these lobbyists do this if not to find the favor of the man responsible for controlling the committee that will set the price controls under which the lobbyists will suffer?

One thing should be noticed here. There are no doctors in the mix. It is politicians, unelected appointees, and lobbyists that will be setting these policies. Not doctors, not patients, not hospitals or families.

(Cross posted at HealthcareHorseRace.com.)

© Warner Todd Huston


The views expressed by RenewAmerica columnists are their own and do not necessarily reflect the position of RenewAmerica or its affiliates.
(See RenewAmerica's publishing standards.)

Warner Todd Huston

Warner Todd Huston's thoughtful commentary, sometimes irreverent often historically based, is featured on many websites... (more)

More by this author